June 20, 2020

A whole lot of 538, crown shyness, the meaning of wealth

A note for the reader: Before this newsletter moved to Substack it was an email thread between friends. I’m posting the previous emails here for completeness, and so that if I invoke a previous comment readers can refer to them.

Hello friends!

I am starting this as I wait for a large chunk of code to finish running on my computer. I am pulling down weather data from NOAA’s API to investigate a question my boss posed to our office (and later, unrelatedly, Nate Silver tweeted): does really hot weather cause a spike in coronavirus cases as people are sent indoors for A/C?

So… ~ that’s exciting ~

Here’s the best I’ve got this week

1) Old but gold: Speaking of 538 and data work, was scouring some datasources for nothing in particular and came across this absolutely wild article.

2) More 538 because I am a Stan its true: This article discusses the differentiation between ‘bellwether’ and ’tossup’ states. This added “bellwether” to my list of state designations, in addition to toss-up, battleground (toss-ups + lean D/R), and tipping point. I spoke at length this week (last week?) with Benedict, Aren, and Wes about whether another designation of “keystone state” would be useful, referring to those states that are highly correlated with winning under any given prediction model. Happy to discuss if anyone is interested, but don’t want to take up your inbox otherwise.

3) Wild world: Crown shyness is the term for when the tops of trees do not touch each other despite growing close together. This also is what it is called when you binge the Crown all weekend because you think it’d be too awkward if you went to a party. Seems strange nobody in the article suggests that there could be some evolutionary cooperation mechanism at play, seeing that it occurs often with trees of the same species. Cooperation (not exerting resources to fight for light from your neighbor of the same species) is very likely the winning evolutionary strategy here.

4) A nice way to do science: What makes air-dried linens smell so good?

5) Money talks: What is wealth? This is a question I’ve been kicking around for several months after reading this article. I particularly am fond of the “Mr. Darcy” version (of Pride and Prejudice), not mentioned here, and perhaps troubled by the inability to compare financial instruments across time: wealth is the stream of income it buys you.

I’m going to play fast and loose with definitions and make phrases up as I go here so please forgive me. One’s wealth generally is owned in one of two classes of financial vehicles:

- commodities (those things that change in value but do not supply streams of payments, e.g. gold, bitcoin, unbanked cash, art) or

- vested assets (which is a phrase I am making up for any thing that has either the promise or the possibility of future cash flows, e.g. stocks, bonds, rental properties).

We can then expand this definition out a bit into the stream of utility it buys you (for the non-economists who find this in their inbox, think of a mixture of happiness and deep contentedness and you get close to utility). Now, things like your dishwasher or your intellectual properties such as playlists are also important here, as they supply you with utility but you’d never sell them.

This, too, brings in a new question of personal preferences, which makes things even harder to measure. As Ben Delsman has pointed to me, those who are easily sated because they like things others don’t (say, banana laffy taffies) or they require little material objects for contentedness (e.g. monks) truly are more wealthy than others.

But then also you get into a wild world where not only one needs to account for the stream of utility an item gets you (I get so much utility each time I use my dutch oven to bake bread), but also from any positive memories that the item generated. But wait, some things are only special and create positive memories because they’re novel, such as the great memory of a luxurious splurge on a vacation. And so there’s certainly a sense that scarcity can itself create wealth.

And too, things that we plan to spend money on can make us happy — who hasn’t been excited about a vacation or going to a concert (perhaps even excited about giving away a gift, but that’s a whole separate question).

Here, then, is another wrinkle, as we have to think about on what time scale one’s utility is measured. In an instant? A donut could make you instantly the wealthiest person alive and then nearly destitute as you regret the decision the rest of the day. Over a lifetime? Certainly we think at the scale of a lifetime that things more important than money make you happy. But what about those who live tragically short but terrific lives? Are they wealthier than those who live to be 100 but though it was all kinda ¯\_(ツ)_/¯?

I don’t know, it really makes my head hurt to think about. But my view is that there’s probably some answer that comes down to a recognition that most wealth is determined by non-financial innovations (friendships, religion, learning, enlightenment, expressive crafts, community, yoga? Bread? Drugs?) that are, in economic terms, technologies that produce utility for you better than it could be produced before, and sometimes out of nothing. Additionally, one’s susceptibility to anxiety or excitement (forward-looking) impacts their wealth (technologies here: CBT, annual holidays), as is one’s ability to manage regret and gratitude (backward-looking; tech: decision-making processes and gratitude journaling). Of course, too, the present matters. The act of being present (tech: mindfulness) is known to bring many benefits on disposition, and one’s inherent disposition and curiosity can shape how situations are processed, and therefore how the impact happiness.

6) Shaker of salt: Ok FINE one more 538-related item. I got derailed from when I started this email. I started playing with 538’s newly released state-level polling averages for the presidential general election. A strong word of caution — we are very far out from the election, and in a highly volatile environment. Things can change rapidly. You should not radically change your worldview as the result of the polls right now.

Those caveats in the ground, one graph I found interesting that I made was this one, which captures Biden’s spread (Biden support - Trump support) against share undecided. As we move further to the right uncertainty increases, as it also does the closer we get to 0 on the y-axis. I’ve colored the states that have over 50% estimated support for each candidate (blue is >50 Biden support, red >50 Trump, green neither), as this is an important threshold (assuming the polls are on target — which they may not be!) since your opponent being above 50 means that you have to start to take away support from your opponent to win, not just capture the undecideds. The lines represent certainly-over-50 (solid) and possible-to-over-50 (dashed). Again, further to the right, more uncertainty. Some states are missing if they don’t get polled, typically because they’re very blue/red (think Hawaii and Louisiana). Sorry, the legend here was made hastily (U = neither candidate over 50%).

This and the NOAA data took up a good chunk of my day, so I’m going to call it at 6 items today.

I now am going back to the NOAA data.

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Weekly Recommendation: Play this when you WFH.

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Thanks for letting me talk at you via your inbox. Your friend,

Harrison

Correction sent later: FORGOT: S/o Ata Baltaci for the weekly recommendation this week. Changed my life. ❤